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When Truth Survives Free Speech

Last week, a story came across my desk that seemed to suggest that a blogger had been unfairly nailed with a $2.5 million defamation award after a judge refused to give her standing as a journalist. A businessman who was the target of the blogger’s inquiries brought the suit.

I went to work on a blog post, filled with filial umbrage, saddened that the Man once again had used a boot heel to crush truth and free speech. But after doing a little reporting, I began to think that what scanned as an example of a rich businessman using the power of the courts to silence his critic was actually something else: a case of a blogger using the Web in unaccountable ways to decimate the reputation of someone who didn’t seem to have it coming.

The ruling on whether she was a journalist in the eyes of the law turned out to be a MacGuffin, a detail that was very much beside the point. She didn’t so much report stories as use blogging, invective and search engine optimization to create an alternative reality. Journalists who initially came to her defense started to back away when they realized they weren’t really in the same business.

On the surface, it seemed that the blogger, Crystal Cox, was doing the people’s work. A blogger and real estate agent in Montana who spent a lot of time fighting with the National Association of Realtors, Ms. Cox took an interest a few years ago in the bankruptcy of Summit Accommodators, an intermediary company in Bend, Ore., that held cash to complete property exchanges. The company went belly up and a federal grand jury indicted three senior executives — a fourth pleaded guilty — charging them with conspiring to defraud clients of millions.

Kevin D. Padrick, a lawyer in Oregon, was appointed as trustee in the case after the company entered bankruptcy. Prompted by the postings of someone whom Mr. Padrick was going after to recover assets — the daughter of one of the men who was indicted — Ms. Cox began suggesting in her blog posts that Mr. Padrick had used inside information and illegal measures to take control of the remaining assets and enrich himself.

In a long-running series of hyperbolic posts, she wrote that Mr. Padrick and his company, the Obsidian Finance Group, had engaged in bribery, tax fraud, money laundering, payoffs and theft, among other things. Her one-woman barrage did not alter the resolution of the Summit affair, but it was effective in ruining Mr. Padrick.

In a phone interview, he told me his business as a financial adviser had dropped by half since Ms. Cox started in on him, and any search of his name or his company turned up page after page on Google detailing his supposed skullduggery, showing up under a variety of sites, including Bend Oregon News, Bankruptcy Corruption, and Northwest Tribune.

As it turned out, all of the allegations and almost all of the coverage in the case were coming from Ms. Cox, who churned URL’s and cut-and-pasted documents to portray Mr. Padrick as a “thug,” and a “thief” who “committed tax fraud” and who may have “hired a hit man” to kill her while engaging in “illegal and fraudulent activity.”

Here’s the problem. None of that was ever proved, nor was it picked up by other mainstream media outlets.

Even a broken clock is right twice a day, but there is nothing in Mr. Padrick’s professional history or the public record that I found to suggest he is any of those things. He was appointed as a trustee by the court, he was subjected to an F.B.I. background check, and there have been no criminal investigations into his conduct. About 85 percent of the funds have been returned to the creditors, which seems to be a good result.

Annie Buell, the chairwoman of the Official Unsecured Creditors Committee who was appointed by the United States Trustee’s Office, said in an interview by phone that there was no basis in fact for Ms. Cox’s scabrous postings about Mr. Padrick.

“He did a very good job for the creditors,” she said. “He was above-board, had all of his cards on the table and was competent and fair. If I ever was in the same situation again, he would be my first choice.” Lawyers I spoke with who had done business with Mr. Padrick used similar adjectives to describe him.

Mr. Padrick, a lawyer who is a member of the bar in four states and has never been disciplined or investigated from anything I could find, said he spent a lot of sleepless nights wondering how he ended up as Ms. Cox’s bête noire.

“A woman who I did not know, who had no connection to me or my company or with this case she has been making statements on, has turned my business life and personal life upside down,” he said. “Companies who are considering doing business with us do a routine search on Google and there is page after page of these allegations. If it can happen to me, it can happen to anybody.”

And it has. Ms. Cox, who calls herself an “investigative blogger,” has a broad range of conspiratorial/journalistic interests. She has written that Bruce Sewell, the general counsel of Apple, “aids and abets criminals”; that Jeffrey Bewkes, the chief executive of Time Warner, is “a proven technology thief”; and that various Proskauer Rose lawyers have engaged in a pattern of “conspiracy.” And don’t get her started on the local officials in and around her hometown, Eureka, Mont.

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When she gets in a fight with someone, she frequently responds by creating a domain with the person’s name, some allegation of corruption, or both. Many of the negative posts about Mr. Padrick appeared on obsidianfinancesucks.com and there are many more like it. In order to optimize visibility to Web crawlers, she often uses the full name and title of her target, and her Web sites are filled with links to her other sites to improve their search ranking. She has some 500 URLs at her disposal and she’s not afraid to use them.

“I have a gift for getting on top of search engines and I want to give voice to victims of the corrupt judicial system,” she said in an interview by phone. “The system wants to shut me up and they have been trying to for years.”

“I’m glad I lost the case, because it gives attention to what I have been doing,” she added, saying she doesn’t have money to hire an attorney — she represented herself in the defamation case — let alone $2.5 million to pay in damages. She plans to appeal.

She said she remained convinced that Mr. Padrick would be indicted, “even if I have to stay on it for the next decade.” But, as Forbes first pointed out following the verdict, she had been willing to negotiate a cease-fire.

“At this Point in my Life it is Time to Think of Me,” she wrote in a letter to Mr. Padrick’s lawyer, David Aman. “So I want to Let you know and Obsidian Finance that I am now offering PR Services and Search Engine Management Services starting at $2,500 a month,” she wrote, to promote “Law Firms” and “Finance Companies” and “to protect online reputations and promote businesses.”

What looked to be an unsubtle offer to holster her gun in exchange for a payoff was signed, “In Love and Light, Crystal Cox.”

Ms. Cox said that she sent that note in response to a request from Mr. Padrick’s attorney — Mr. Aman said he made no such inquiry — and that she was “not on trial for writing e-mails.”

In the pre-Web days, someone like Ms. Cox might have been one more obsessive in the lobby of a newspaper, waiting to show a reporter a stack of documents that proved the biggest story never told. The Web has allowed Ms. Cox to cut out the middleman; various blogs give voice to her every theory, and search algorithms give her work prominence.

Mr. Padrick, who had never met Ms. Cox and had no idea why she seemed intent on destroying him, sued her last January. Judge Marco Hernandez of United States District Court in Portland, Ore., threw out most of his claims of defamation, ruling that Ms. Cox’s posts were so over-the-top that no reasonable reader would conclude that she was making allegations of fact.

But Judge Hernandez did allow that a single post published on Christmas Day in 2010 charging all manner of criminal conduct could be read as containing “provable assertions of fact.” A one-day trial took place on Nov. 29, and after deliberating for 75 minutes, the jury awarded Obsidian $1 million and Mr. Padrick $1.5 million.

“I view our case as a blow for the First Amendment,” said Mr. Padrick. “If defamatory speech is allowed just because it is on the Internet, it cheapens the value of journalism and makes it less worthy of protection.”

Mr. Padrick signed off by reminding me that those who have been in conflict with Ms. Cox frequently find their names showing up in newly registered Web addresses. I’m thinking of buying RottenScoundrelDavidCarr.com as soon as I’m done typing.

Then again, I’ve got some institutional muscle when it comes to how I’m perceived on the Web. All Mr. Padrick had was his good reputation. Too bad there’s no algorithm to measure truth.

E-mail: carr@nytimes.com;

Twitter.com/carr2n

A version of this article appears in print on December 12, 2011, on Page B1 of the New York edition with the headline: When Truth Survives Free Speech. Order Reprints|Today's Paper|Subscribe